Producer Company Registration
A producer company can be defined as a legally recognized body of farmers/ agriculturists with the aim to improve the standard of their living and ensure a good status of their available support, incomes and profitability. Producer Company provides better collective bargaining power to the farmers as they are able to achieve more when they unite.
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What is a Producer Company?
A Producer Company is established in accordance with the Companies Act of 2013 and is responsible for overseeing the production, procurement, and marketing of agricultural products from farmers. This type of company is created by a collective of primary producers, including farmers, artisans, or rural producers. It operates as a cooperative, promoting shared ownership and collaborative decision-making to ensure enhanced resources and income for its members.
The primary objective of registering a producer company is to promote the interests of its members by facilitating production, marketing, sales, and export of their core products. By providing a well-organized framework for collective advancement, the company seeks to enhance market access and improve benefits for its members. Additionally, the company is authorized to import goods or services essential for the welfare and efficient functioning of its members.
Benefits of Producer Company Registration
1.Limited Member Liability
Members of a Producer Company are not held personally liable for the company’s debts and losses. For any losses to the organization, the personal assets of the members would not be at risk.
2. Government Grants
The government periodically offers certain benefits and grants to these companies. With Producer Company Registration, they can avail themselves of these benefits to help their organization grow and establish themselves in the market.
3. Separate Legal Entity
The Producer Company Registration makes the entity a different legal entity through which it can directly enter into contracts and even own property in its name. Any legal case in the court can also be initiated in the company’s name, making it more credible in the market.
4. Taxation Benefits
Producer Company Registration ensures that the organizations get tax benefits through their business activities. They get certain exemptions during the initial 5 years and sometimes lower tax rates on their expenses. This helps them grow their business and survive in the market.
5. Capital Access
Producer Company Registration helps entities access capital through their investors by issuing them shares and debentures. It also helps these organizations grow in the market and expand their business further.
6. Market Access
Through company registration, these entities gain enough market outreach that more customers connect with them, generating profits and allowing their businesses to grow further.
7. Technological Advancement
Through Producer Company Registration, the farmers get enough support in terms of machinery, making it easier for them to cultivate and harvest crops. This reduces their workload and allows them to process the work quickly.
8. Funding from Banks & Financial Institutions
These entities find it simpler to obtain funding from banks and financial institutions at a low cost. The process of company registration lends them credibility and confidence in their legitimacy, thereby facilitating access to substantial loans with reduced interest rates.
Requirements for a Producer Company Registration
- There must be at least 10 members to get a Producer Company Registration.
- The members must also be the producers in the company, and they should be linked to producing their goods and services.
- The company’s farmers should be inclined to contribute to its minimal capital requirement, which is Rs 5 Lakhs.
- There must be a board of directors in the company where at least 5 members should be there, along with two-thirds of the directors being producers as well.
- The company must have PAN, TAN, Articles of Association and Memorandum of Association.
- The company’s name should end with ‘Producer Limited Company’.
- The company to be registered should have a registered official address in the country.
Documents Required for Producer Company Registration
- The PAN and Aadhar card of the directors and members.
- Passport-sized photographs of the directors and members. Documentation verifying the registered official address (such as a gas bill, electricity bill, telephone bill, or rent agreement).
- PAN, TAN, Articles of Association (AoA), and Memorandum of Association (MoA).
- Digital Signature Certificate (DSC) and Director Identification Number (DIN).
- A No Objection Certificate from the registered office owner (if applicable).
- Producer certificate issued by the District Horticulture Officer.
- A copy of the registration certificate for the Producer Organization.
-
Consent from the director in Form DIR-2.
Producer Company Registration Process
Documentation
The applicant is required to gather all essential documents needed to complete the form and submit it for approval of Producer Company Registration. These documents are compulsory and are vital for the successful completion of the registration process.
Obtaining DIN & DSC
The completion of the process necessitates the Digital Signature Certificates of all shareholders as well as the directors. Additionally, it is essential to obtain the Director’s Identification Number, which must be acquired through the Ministry of Corporate Affairs.
Drafting of AoA & MoA
The preparation of the Articles of Association (AoA) and Memorandum of Association (MoA) is an essential process, as it establishes the company’s policies, objectives, mission, vision, and governing rules. This foundational step guarantees the proper operation of the company and adherence to the regulations set forth by the Companies Act.
SPICe+ Application Form
To initiate the process of incorporating a company, it is necessary to complete the online SPICe+ application available on the official website of the Ministry of Corporate Affairs (MCA). Part B of this application is designated for the registration of a Producer Company, while Part A is intended for the reservation of a company name. Any director of the Producer Company is authorized to fill out the application, which must be signed prior to submission, along with the requisite supporting documents, to the Registrar of Companies (ROC).
Incorporation Certificate
Following the submission of the SPICe+ application to the Ministry of Corporate Affairs (MCA), the MCA conducts a thorough review of the application form and all associated requirements prior to issuing the incorporation certificate to the producer company.
Legalixo Support in transitioning a Producer Company Registration
- Purchase a Plan for Expert Assistance
- Add Queries Regarding the conversion
- Provide Documents to legalixo Expert
- Complete all other required Actions
- Get your work done!
Benefits of Producer Company Registration
1.Limited Member Liability
Members of a Producer Company are not held personally liable for the company’s debts and losses. For any losses to the organization, the personal assets of the members would not be at risk.
2. Government Grants
The government periodically offers certain benefits and grants to these companies. With Producer Company Registration, they can avail themselves of these benefits to help their organization grow and establish themselves in the market.
3. Separate Legal Entity
The Producer Company Registration makes the entity a different legal entity through which it can directly enter into contracts and even own property in its name. Any legal case in the court can also be initiated in the company’s name, making it more credible in the market.
4. Taxation Benefits
Producer Company Registration ensures that the organizations get tax benefits through their business activities. They get certain exemptions during the initial 5 years and sometimes lower tax rates on their expenses. This helps them grow their business and survive in the market.
5. Capital Access
Producer Company Registration helps entities access capital through their investors by issuing them shares and debentures. It also helps these organizations grow in the market and expand their business further.
6. Market Access
Through company registration, these entities gain enough market outreach that more customers connect with them, generating profits and allowing their businesses to grow further.
7. Technological Advancement
Through Producer Company Registration, the farmers get enough support in terms of machinery, making it easier for them to cultivate and harvest crops. This reduces their workload and allows them to process the work quickly.
8. Funding from Banks & Financial Institutions
These entities find it simpler to obtain funding from banks and financial institutions at a low cost. The process of company registration lends them credibility and confidence in their legitimacy, thereby facilitating access to substantial loans with reduced interest rates.
Requirements for a Producer Company Registration
- There must be at least 10 members to get a Producer Company Registration.
- The members must also be the producers in the company, and they should be linked to producing their goods and services.
- The company’s farmers should be inclined to contribute to its minimal capital requirement, which is Rs 5 Lakhs.
- There must be a board of directors in the company where at least 5 members should be there, along with two-thirds of the directors being producers as well.
- The company must have PAN, TAN, Articles of Association and Memorandum of Association.
- The company’s name should end with ‘Producer Limited Company’.
- The company to be registered should have a registered official address in the country.
Documents Required for Producer Company Registration
- The PAN and Aadhar card of the directors and members.
- Passport-sized photographs of the directors and members. Documentation verifying the registered official address (such as a gas bill, electricity bill, telephone bill, or rent agreement).
- PAN, TAN, Articles of Association (AoA), and Memorandum of Association (MoA).
- Digital Signature Certificate (DSC) and Director Identification Number (DIN).
- A No Objection Certificate from the registered office owner (if applicable).
- Producer certificate issued by the District Horticulture Officer.
- A copy of the registration certificate for the Producer Organization.
-
Consent from the director in Form DIR-2.
Producer Company Registration Process
Documentation
The applicant is required to gather all essential documents needed to complete the form and submit it for approval of Producer Company Registration. These documents are compulsory and are vital for the successful completion of the registration process.
Obtaining DIN & DSC
The completion of the process necessitates the Digital Signature Certificates of all shareholders as well as the directors. Additionally, it is essential to obtain the Director’s Identification Number, which must be acquired through the Ministry of Corporate Affairs.
Drafting of AoA & MoA
The preparation of the Articles of Association (AoA) and Memorandum of Association (MoA) is an essential process, as it establishes the company’s policies, objectives, mission, vision, and governing rules. This foundational step guarantees the proper operation of the company and adherence to the regulations set forth by the Companies Act.
SPICe+ Application Form
To initiate the process of incorporating a company, it is necessary to complete the online SPICe+ application available on the official website of the Ministry of Corporate Affairs (MCA). Part B of this application is designated for the registration of a Producer Company, while Part A is intended for the reservation of a company name. Any director of the Producer Company is authorized to fill out the application, which must be signed prior to submission, along with the requisite supporting documents, to the Registrar of Companies (ROC).
Incorporation Certificate
Following the submission of the SPICe+ application to the Ministry of Corporate Affairs (MCA), the MCA conducts a thorough review of the application form and all associated requirements prior to issuing the incorporation certificate to the producer company.
Legalixo Support in transitioning a Producer Company Registration
- Purchase a Plan for Expert Assistance
- Add Queries Regarding the conversion
- Provide Documents to legalixo Expert
- Complete all other required Actions
- Get your work done!
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